Feb 14, 2017

Yellen shoots down Trump claim that Dodd-Frank dampens lending

Dodd-Frank is not choking off lending, Fed Chair Janet Yellen told the Senate Banking Committee. That's counter to what Trump said about the law needing to be rolled back because "I have so many people, friends of mine, who have nice businesses who can't borrow money," due to the law.

At the behest of Elizabeth Warren, Yellen contradicted this impression, saying that " we have seen healthy growth in actual lending in the economy," since the passage of Dodd-Frank, and that overall lending has surpassed its 2008 peak.

Why this matters: the Trump administration wants to dismantle Dodd-Frank and likes to use how it's depressed useful financial activity, like lending, as a reason. That' why Trump brought it up recently. The claim doesn't hold water.

From earlier here's Yellen's opening statement: Janet Yellen bullish on the U.S. economy

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